Silvercrest Wants to Sell Its Mobile-Home Business
Silvercrest Industries Inc. in Santa Ana said Monday it is trying to sell its mobile-home manufacturing business, which last year accounted for 78% of the company’s sales and 74% of its profits.
The company was prodded by the American Stock Exchange to make the brief announcement after a flurry of trading in its stock Friday and Monday, Silvercrest said.
The company said it contacted a potential buyer two weeks ago. No price for the business has yet been negotiated, Silvercrest said. The company withheld the identity of the potential buyer.
The company said it has heard rumors that news of the talks had leaked out.
Silvercrest President Richard Simonian said his company needs to raise cash for its legal defense after a subsidiary was sued by Los Angeles home builder Kaufman & Broad Inc. earlier this year.
Kaufman & Broad alleges that the Silvercrest subsidiary defrauded the home builder out of millions of dollars when the two were partners in developing a mobile-home subdivision in Los Angeles.
Also, Simonian said, Silvercrest needs cash because a $10-million sale of bonds fell through last year with the stock market collapse.
Silvercrest reported an anemic $65,000 profit on sales of $52.5 million through its third quarter ending March 31.
Sale of the mobile-home manufacturing business would leave the company with only its roofing materials business and an even smaller business of managing mobile-home parks.
“I don’t see that there’d be much left of the company after a sale,” said Jeff Kilpatrick, president of Newport Securities Corp. in Costa Mesa.
Simonian said the company is beginning to glean sales from its business of developing new mobile-home subdivisions, but he admitted that would not pick up much of the slack.
Silvercrest stock closed at $3 Monday, up 37 1/2 cents on trading of 6,700 shares, which Simonian described as “heavier-than-usual volume” for the stock.
On Friday, the stock price rose 25 cents a share to $2.625, with 5,000 shares traded.
